The U.S. dollar’s position as the world’s dominant reserve currency is facing renewed scrutiny as central banks and investors reassess America’s global role following Washington’s actions in Venezuela.
Analysts say President Donald Trump’s America First approach, highlighted by the capture of Venezuelan leader Nicolás Maduro, has reinforced perceptions that the United States is prioritizing its own interests over global norms.
U.S. dollar dominance could be in danger https://t.co/yTE1rZbAZ3
— Axios (@axios) January 7, 2026
That shift has fueled efforts by central banks to diversify away from the dollar, increasing holdings of gold and other currencies.
The dollar’s share of global foreign exchange reserves fell to multidecade lows in 2025, while concerns persist over sanctions policy, tariffs, and fiscal uncertainty.
Critics warn that frequent use of the dollar as a geopolitical weapon could weaken long-term trust, according to Axios.
Some economists argue strong U.S. technology growth and artificial intelligence leadership could offset those risks by attracting global investment.
Others caution that erosion of institutional credibility, including rule-of-law concerns, could undermine the dollar’s reserve status over time.
Also read:
TIPP Staff
